Opec must keep supply and price stable

The Organisation of Petroleum Exporting Countries (Opec) decided to keep its production ceiling unchanged at its meeting last week.

Faced with volatile oil price, which dropped sharply ahead of the meeting, member states agreed that for now, leaving the supply of crude to the market unchanged would be the best course of action.

Opec cannot react to short-term movements in the market. Its chief objective is to achieve price stability at levels which are sustainable for its member states and global economy. Some member states have put this at $100 (Dh367.8) a barrel, in part to cover new investment in production capacity and meet national budget targets.

Oil price stability is as important for global economy as is its cost. Volatile prices damages consumer and investment confidence and makes it difficult for businesses to budget for sustainable growth the world needs.